Our colleague John Blackburn has highlighted the publication of a new report published by the Henry Jackson Society, based in London.

A new report by a UK Think Tank, the Henry Jackson Society, addresses the supply chain dependence on China by the “Five-Eye” powers.

Of the five powers, Australia is strategically dependent on China for the largest number of imports.

Within goods that service the “Critical 11”, we are strategically dependent on 41 categories and 11 sectors which no other member of the five powers are.

Case studies in the report include pharmaceuticals, energy systems , information technology, as well as food and agriculture.

Andrew Hastie, a contributor to the report, notes that “Our strategic dependency on critical imports makes us vulnerable to not only economic coercion, but also supply chain warfare.

To mitigate this risk, the Australian government should initiate a review of all trade-exposed products, industries and sectors in the economy.”

Our Institute recently suggested to a Joint Parliamentary Committee that we pursue a Smart Sovereignty and Trusted Supply Chain model.

We maintain that this is not just an issue related to our dependencies on China, but rather a need to review all of our supply chain dependencies.

Our supply chain resilience is poor.

The Executive Summary to the report highlights the challenges:

Since the end of the Cold War, the United Kingdom (UK), United States (US), Australia, Canada and New Zealand – the five powers commonly known in intelligence circles as the “Five Eyes” – have been among the leading advocates of “hyper-globalisation”, the idea that markets should prevail over almost all other considerations. China has benefited disproportionally from this form of globalisation, leading to a fundamental transformation in its economic and industrial fortunes over the past two decades.

Although already well-established in the US, the idea of “decoupling”, particularly from China’s economy, has gained currency with the COVID-19 crisis. The inability to produce and source Personal Protective Equipment via globalised supply chains has reminded democratic governments and peoples that it is necessary to be able to produce strategic commodities, just as China’s actions and behaviour have reminded them of the authoritarian nature of the Chinese Communist Party (CCP).

Under Xi Jinping’s leadership, the CCP has already used China’s economic power as a geostrategic weapon to revise the rules-based international system. Now vulnerable to rising domestic and international criticism over its handling of the COVID-19 outbreak, the CCP has adopted a policy of aggressive defence, to the extent that it is exploiting accumulated economic dependencies for political gain. While the rest of the world remains focused on combatting COVID-19, China is pushing forward with strategic campaigns to dominate all major sectors of global trade, and by degrees to take over control of international market standards.

For the full report, see the following:

https://henryjacksonsociety.org/publications/breaking-the-china-supply-chain-how-the-five-eyes-can-decouple-from-strategic-dependency/

 

 

Air Vice-Marshal Andrew Clark of the Royal New Zealand Air Force spoke recently to the virtual RAAF Airpower Conference on the Indo-Pacific Region. Originally, the conference was to be held in March 2020, but was postponed due to COVID-19.

But the RAAF’s Airpower Development Centre has moved ahead with a virtual conference, consisting of the core presentations which would have been given in person.

In his presentation, Air Vice-marshal Clark focuses on why pulling up the drawbridge which has been done to hold COVID-19 at bay is not the way ahead for New Zealand in the South Pacific region.

This is a maritime region, with vast distances and many small nations.

He argued that geography is an important definer for New Zealand security but that geography is being altered by forces which are not limited by geography, such as cyber and space.

He argues that the New Zealand neighborhood had many “disrupters” in play reshaping the security environment, such as climate change.

He explained that New Zealand worked a wide variety of partnerships but was fully committed to supporting a rules based order in the region.

He noted that New Zealand needed to enhance its situational awareness and reach in the region, which is leading to acquisitions in the maritime awareness and lift domains.

These priorities were highlighted in the 2019 defence capability plan for New Zealand.

Defence-Capability-Plan-2019

He argued for a broader view of the “gray zone” which is the area within which New Zealand operates its forces and its relationships going forward.

His presentation can be viewed below:

Air Vice-Marshal Andrew Clark

Air Vice-Marshal Clark joined the Royal New Zealand Air Force in 1986 as a Navigator. During his flying career he has had four operational tours on P-3 Orion aircraft, as well as a tour as an instructor with the Royal Australian Air Force. His flying career has included command of an operational mission in the Middle East, and culminated with a tour as Commanding Officer of No. 5 Squadron.

Throughout his career Air Vice-Marshal Clark has held a variety of operational and strategic level staff positions. In recent years these positions have included Assistant Chief of Air Force – Strategy Management, Director of Strategic Commitments, Director of Defence Intelligence, Deputy Chief of Air Force, Assistant Chief Capability and Air Component Commander.  In addition, he has served as the New Zealand Defence Adviser to India.

Air Vice-Marshal Clark completed Staff College in Australia. He has a Masters degree in Management (Defence Studies) from the University of Canberra and a Graduate Diploma in Defence Studies from the University of New South Wales.

Air Vice-Marshal Clark was appointed Chief of Air Force in September 2018.